The first half of FY 2025-26 was particularly impressive, with H1 GDP growth of 8.0% driven by private consumption revival, accelerating capital formation, and a resurgent manufacturing sector that grew at 9.1% in Q2. The financial services sector expanded at 10.2% during the same period, providing a favourable operating environment for companies in the financial services industry.
Inflation remained benign for the majority of the year, with CPI inflation declining for nine consecutive months to reach an 8-year low of 1.6% in July 2025. The full-year average CPI inflation came in at approximately 2.1% the lowest since the series began. This disinflationary trend was driven primarily by a sustained decline in food prices and the impact of GST rate rationalisation from September 2025.
The Reserve Bank of India maintained an accommodative stance for most of the year, with the repo rate at 5.25% following a 25 bps cut in December 2025.
India finished FY 2025-26 with a current account deficit of $25.2 billion, compared with $22.9 billion in FY 2024-25. As a share of GDP, the deficit remained stable at 0.6%. The stable figures were aided by current account surplus of $7.1 billion in the March 2026 quarter, supported by stronger services earnings and record remittance inflows.
Indian capital markets experienced a year of two distinct halves. The first three quarters (April 2025 to December 2025) were characterised by healthy domestic participation, record SIP inflows, and a buoyant IPO market. However, Q4 FY 2025-26 saw a sharp correction driven by the West Asia conflict, sustained FII selling, and elevated crude oil prices.
The Nifty 50 index, which touched a record high of 26,277 in September 2024, experienced significant volatility in FY 2025-26. The benchmark index ended the year at 22331, reflecting a year-on-year decline of approximately 5.1%. The broader markets - Nifty Midcap 100 and Nifty Smallcap 250 - experienced sharper corrections due to valuation compression and risk-off sentiment in the second half.
Foreign Portfolio Investors (FPIs) were net sellers for the year, with cumulative outflows exceeding $1.53 trillion in FY 2025-26. This was driven by a combination of factors including attractive US Treasury yields, a stronger US dollar, geopolitical uncertainty, and a rotation towards Al-related investments in the US and South Korea. March 2026 alone saw FPI outflows of $1.23 trillion - the steepest monthly sell-off on record.
However, domestic institutional investors (Dlls) provided a strong counterbalance, with net purchases exceeding $8.5 trillion in FY 2025-26. Mutual fund SIP inflows remained robust throughout the year, consistently exceeding $25,000 Crore per month and reaching $3.50 trillion in FY 2025-26 - a reflection of the deepening retail participation in Indian equity markets.
The total number of demand accounts crossed 22.5 Crore by March 2026, with over 3.2 Crore accounts added during FY 2025-26. The number of unique investors surpassed 12 Crore, with women accounting for nearly one-fourth of this base - highlighting the broadening and deepening of Indias investor base.
The IPO market remained active, with 109 companies raising $1.8 lakh Crore through mainboard IPOs during FY 2025-26. The QIP market saw fund mobilisation of $67,853 Crore, while preferential allotments surged to $1.48 trillion, reflecting the continued appetite for primary market activity despite secondary market volatility.
3.1 Broking Industry
The Indian broking industry continued its evolution towards digital-first,
compliance-heavy, and diversified revenue models. SEBIs regulatory interventions -
including the true-to-label circular for derivatives, enhanced margin requirements, and
restrictions on high-frequency trading - reshaped the competitive landscape and
accelerated the consolidation of the industry towards larger, well-capitalised players.
The shift from transaction-based to annuity-based revenue models continued, with leading broking firms increasing their share of revenue from margin funding, distribution income, and advisory fees. The growth in margin trading facilities (MTF) was particularly noteworthy, emerging as a significant revenue contributor for full-service brokers with strong risk management capabilities.
3.2 Investment Banking
The investment banking landscape in India experienced robust activity in FY 2025-26, with
aggregate capital market transactions in equities exceeding ? 4.5 Lakh Crore across IPOs,
FPOs, QIPs, preferential allotments, and rights issues.
The demand for mid-market investment banking services grew significantly, driven by emerging companies seeking capital for growth, expansion, and consolidation. Monarch Networth Capital continued to build its presence in this space with a focus on quality execution and client-centric advisory.
3.3 Alternate Investment Funds (AIF)
The Indian AIF industry continued its strong growth trajectory, with total investment
commitments rising by 25.6% to ? 16,94 trillion, up from ? 13.49 trillion in the previous
year. By the end of FY 2025-26, the AIFs total AUM, representing cumulative net
investments, increased by 25.7% Y-O-Y to ? 6.76 trillion. Category III AIFs, in
particular, saw increased traction from High Net Worth Individuals (HNIs) and family
offices seeking alpha generation through concentrated, high-conviction equity strategies.
The regulatory framework continued to evolve, with SEBI introducing enhanced disclosure
norms and governance standards for AIFs.
3.4 Portfolio Management Services (PMS)
The PMS industry in India witnessed steady growth, driven by increasing demand from
affluent investors seeking personalised wealth management solutions. The minimum
investment threshold of ? 50 Lakh continued to attract serious, long-term investors.
SEBIs emphasis on performance disclosure and fee transparency further strengthened
investor confidence in the segment.
Under the leadership of CEO Mr. Gaurav Bhandari, the Company has been transformed from a single-line broking firm into a fully diversified financial services platform offering Retail Broking, Institutional Equities, Investment Banking, Alternate Investment Funds, Portfolio Management Services, Wealth Management, Debt Capital Markets, and an upcoming Asset Management Company (Mutual Fund licence received in FY 2025-26).
The Companys Profit After Tax has grown from ? 2.2 Crore in FY 2019-20 to ? 181.2 Crore in FY 2025-26 - a Compound Annual Growth Rate (CAGR) of 108%. The Companys net worth has crossed ? 971 Crore as at March 31, 2026, representing a 51% CAGR over 6 years. Revenue CAGR over the same period stands at 32%. The Company has maintained a net debt free balance sheet throughout this growth trajectory.
In FY 2025-26, the Company achieved a significant milestone with the receipt of the Mutual Fund licence from SEBI, completing its vision of offering the entire spectrum of financial services under one roof. This positions the Company uniquely among mid-cap financial services firms, with the ability to cross-sell and upsell across product categories to a growing client base.
Brokerage Income: Gross brokerage income for FY 2025-26 stood at ? 86.1 Crore. The Companys client base grew to over 3 Lakh clients, serviced through a network of 400+ Sub-Brokers and Authorised Partners across 50+ cities. The focus remained on acquiring quality clients with higher average revenue per user (ARPU) through personalised service and relationship-driven engagement.
Margin Trading Facility (MTF): MTF income grew significantly to ? 49.6 Crore in FY 2025-26, reflecting the growing adoption of leverage products by informed retail and HNI clients. The Company maintained a disciplined approach to MTF - with conservative loan-to-value ratios, robust risk management systems, and real-time collateral monitoring - ensuring high asset quality throughout the year.
Interest Income: Interest income from the broking business stood at ? 111.4 Crore for FY 2025-26, driven by growth in the MTF book and effective deployment of client margins within regulatory guidelines.
5.2 Investment Banking
The Investment Banking division had another strong year, with Merchant Banking and
Advisory revenue of 51.5 Crore in FY 2025-26. The Company successfully executed multiple
high-profile transactions including QIPs, preferential allotments, IPOs, and buybacks
across various sectors.
Key transactions during FY 2025-26 included the Sarla Performance Fibers buyback (44 Crore) and Baazar Style Retail preferential allotment (331 Crore). The Company also has 3 IPOs with SEBI approval ready for launch and an active pipeline exceeding 2,625+ Crore across 10 transactions.
The division has established itself as a credible midmarket investment banking franchise, trusted by promoters and corporates for execution quality, speed, and institutional investor access. The Companys combined Investment Banking and Institutional Equities platform provides a differentiated advantage - researched origination, institutional distribution, and end-to-end capital markets execution under one roof.
5.3 Alternate Investment Funds (AIF)
Monarch AIF, the asset management arm of the Company, continued its strong growth
trajectory. AUM crossed 1,000 Crore - a significant milestone achieved in less than 5
years from the launch of the first fund with 70 Crore. The division operates long-only
equity schemes with a focussed, concentrated portfolio approach (20-25 stocks) supported
by a strong 10-member in-house research team.
MNCL CCF 2, the Companys flagship closed-ended Category III AIF launched in April 2024, had AUM of approximately 688 Crore total sum along with MNCL CCF 1 is 788 Crore as on March 31 2026. The fund has generated a since-inception CAGR of 13.3% post fees and expenses, pre-tax) against the Nifty 500 TRI return of 7.5%, representing an alpha of approximately 580 basis points. The fund outperformed its benchmark across all time periods - 1-month, 3-month, 6-month, 12-month, and since inception.
During FY 2025-26, the Company received the FME Retail licence at GIFT IFSC and launched appropriate AIF schemes from GIFT City, opening up access to international investors. The Company is also gearing up to launch an open-ended domestic Category III long-only fund, further expanding its product suite.
A key differentiator for Monarch AIF is its capital-efficient operating model - 90-95% of AUM is raised through direct connects without dependence on wealth distribution partners, resulting in lower distribution costs and higher profitability per rupee of AUM managed.
5.4 Portfolio Management Services (PMS)
The Company launched its PMS business - Monarch Wealth Creator Fund - in December 2025,
marking another significant step in its diversification strategy. Within just 6 months of
launch, the PMS achieved AUM of 261 Crore and onboarded 230 clients.
The fund delivered a Time Weighted Rate of Return (TWRR) of +12.35% since inception (as at June 30, 2026), against the BSE 500 TRI return of -2.33%, representing an outperformance of 14.68 percentage points. This strong initial performance reflects the quality of the investment strategy - a blend of thematic and momentum sub-strategies with dynamic fund allocation, concentrated portfolio of up to 25 stocks, and rigorous stock selection through a proprietary framework.
5.5 Institutional Equities
The Institutional Equities division continued to strengthen its research coverage and
institutional client relationships. The division provides independent, high-quality equity
research across sectors, serving domestic and international institutional investors. The
cross-sell synergy between Institutional Equities and Investment Banking - research-led
deal origination and institutional distribution for capital market transactions - remains
a key competitive advantage for the Company.
5.6 Wealth Management & Third-Party Distribution
The Wealth Management division continued to grow its client base and assets, offering
comprehensive financial planning and product distribution services to HNI and Ultra-HNI
clients. The division distributes mutual funds, insurance, bonds, fixed deposits, and
structured products, generating recurring distribution income that adds stability to the
Companys revenue profile.
5.7 Mutual Fund Business (AMC)
In a landmark development, the Company received SEBIs approval for its Mutual Fund
licence during FY 2025-26. This completes the Companys vision of offering the entire
spectrum of financial services - from broking and research to investment banking, AIF,
PMS, wealth management, and now mutual funds - under one integrated platform. The AMC
business is expected to be launched in FY 2026-27, with the first scheme targeted for
launch during the year.
| Particulars (? in Crore) | FY 2025-26 | FY 2024-25 | YoY Growth | CAGR (6Y) |
| Revenue from Operations | 372.2 | 326.8 | 14% | |
| Profit Before Tax | 244.3 | 192.7 | 27% | - |
| Profit After Tax | 181.2 | 149.3 | 21% | 108% |
| Net Worth | 971.4 | 796.8 | 22% | 51% |
| Book Value Per Share (?) | 122.4 | 101.6 | 21% | - |
| Return on Equity (%) | 20.5% | 26.1% | - | - |
FY 2025-26 was a year of significant milestones for the Company. Consolidated PAT crossed ? 181 Crore - the highest-ever - representing a 21% growth over FY 2024-25 and a 108% CAGR over 6 years. Net worth crossed ? 971 Crore, representing a 51% CAGR over the 6 years period. The Companys ROE stood at 20.5%, reflecting the efficient deployment of capital across its diversified business verticals.
The Companys balance sheet remained net debt free throughout FY 2025-26, ensuring financial resilience and the ability to capitalise on growth opportunities without leverage-related constraints.
| Ratio | FY 2025-26 | FY 2024-25 | Change |
| Return on Equity (%) | 20.5% | 26.1% | -560 bps |
| Operating Margin (%) | 69.3% | 66.3% | +300 bps |
| Net Profit Margin (%) | 48.5% | 45.5% | +300 bps |
| Debt-Equity Ratio | 0.03 | 0.01 | +2 bps |
| Current Ratio | 2.36 | 3.11 | -75 bps |
| Earnings Per Share (?) - Diluted | 22.8 | 19.9 | +14.7% |
| Book Value Per Share (?) | 122.4 | 101.6 | +20.5% |
The Companys ROE moderated from 26.1% to 20.5% primarily due to the significant increase in the equity base following the capital infusion of ? 300 Crore in FY 2024-25, which expanded the denominator. The underlying profitability remained strong, with net profit margin improving from 45.5% to 48.5%. The debt-equity ratio remained very low at 0.03x, reflecting the Companys philosophy of growth without leverage.
AMC Business Launch: The receipt of the Mutual Fund licence opens the largest addressable market in Indian financial services. With Indias mutual fund AUM crossing ? 70 Lakh Crore and SIP inflows exceeding ? 30,000 Crore per month, the AMC business represents a transformative growth opportunity for the Company.
AIF Scale-Up: With a proven track record of alpha generation (580 bps over benchmark) and AUM of ? 1,000+ Crore, the AIF business is well-positioned to scale to ? 2,000+ Crore AUM in the next 2 years. The GIFT IFSC licence opens access to international capital.
PMS Growth: The PMS business, launched just 6 months ago, has already demonstrated a 14.68% outperformance over its benchmark. Scaling AUM to ? 500+ Crore in FY 2026-27 is a near-term objective.
Investment Banking Pipeline: With 3 IPOs approved by SEBI and an active pipeline of ? 2,625 Crore, the investment banking division is well-positioned for a strong FY 2026-27.
Retail Broking Expansion: The Companys client base of over 3 Lakh clients, served through 400+ sub-brokers across 50+ cities, provides a scalable platform for further growth. The growing MTF book and interest income provide stable, recurring revenue streams.
Cross-Selling Across Verticals: With 7 business verticals (and AMC upcoming), the Company has a unique ability to cross-sell and upsell across product categories - converting a broking client into an AIF investor, a wealth management client into a PMS subscriber, and an institutional research consumer into an investment banking mandate.
Market Risk: The Companys revenue is partially linked to capital market activity. Prolonged market downturns can impact brokerage volumes, investment banking deal flow, and fair value gains on proprietary investments. The Company mitigates this risk through revenue diversification - with broking, MTF interest income, AIF fees, IB advisory, and distribution income providing multiple revenue streams that are not all correlated to market direction.
Regulatory Risk: The financial services industry is heavily regulated by SEBI, RBI, NSE, BSE, and other authorities. Changes in regulations - such as margin requirements, derivative trading norms, or fee structures - can impact the Companys business. The Company maintains a dedicated compliance team and invests in regulatory technology to ensure proactive compliance.
Concentration Risk: Fair value gains contributed ? 101.5 Crore (27% of total revenue) in FY 2025-26. While this reflects the Companys investment acumen, it also introduces variability in earnings. The Company is actively working to reduce this concentration by scaling operating revenue streams - Broking, IB, AIF, and PMS.
Competition Risk: The financial services industry is highly competitive, with established players, fintech disruptors, and new entrants vying for market share. The Company differentiates itself through its integrated platform, research-led advisory, relationship-driven client engagement, and superior execution quality.
Technology & Cybersecurity Risk: As a technology-dependent business, the Company is exposed to risks related to system failures, data breaches, and cyber attacks. The Company is undertaking a comprehensive IT transformation programme, including process documentation, cybersecurity audits, ITSM implementation, and a maker-checker framework for all critical IT operations.
Geopolitical Risk: The West Asia conflict, elevated crude oil prices, and global trade uncertainty pose risks to Indias macroeconomic stability and capital market performance. While these factors are beyond the Companys control, the diversified revenue model and net debt free balance sheet provide resilience during periods of uncertainty.
The Company has established robust internal control systems commensurate with the nature and size of its business. The internal control framework encompasses financial controls, operational controls, compliance controls, and IT controls.
Key elements of the internal control framework include a maker-checker system for all critical operations, documented Standard Operating Procedures (SOPs) across departments, an ITSM tool for IT service management with mandatory ticket-based resolution, quarterly user access reviews, periodic internal audits, and a whistleblower mechanism for reporting concerns.
The Company is currently undertaking a comprehensive IT transformation programme aimed at complete process documentation, cybersecurity enhancement, system access standardisation, and the implementation of structured MIS reporting across all functions. This transformation is expected to significantly strengthen the Companys internal control environment over the next 12-18 months.
The Audit Committee of the Board reviews the adequacy and effectiveness of internal controls on a quarterly basis. The statutory auditors have not reported any material weaknesses in the internal control framework during FY 2025-26.
The Company recognises that technology is the backbone of modern financial services and has initiated a comprehensive technology transformation programme. Key initiatives include the implementation of a CRM system for the Investment Banking division, migration to a structured ITSM tool for all IT service requests, enhancement of cybersecurity protocols including endpoint security, email security, data encryption, and the standardisation of system access management with a maker-checker framework.
The Company continues to invest in its digital trading platforms - the MNCL RESACH mobile application and web trading platform - to provide clients with seamless trading and portfolio management capabilities. The focus remains on improving platform stability, user experience, and feature richness to drive client engagement and retention.
The Company recognises that its people are its most valuable asset. As at March 31, 2026, the Company had a team of dedicated professionals at its offices in Mumbai (BKC and Goregaon) and branches across India.
During FY 2025-26, the Company undertook several initiatives to strengthen its HR processes and employee experience. These include the redesign of the onboarding process with a structured maker-checker system and digital documentation, the implementation of a comprehensive Code of Conduct (Version 2), the introduction of a Group Term Life Insurance policy providing coverage up to 10x CTC (maximum ? 1.5 Crore) for every employee at zero cost, the launch of a structured ITSM-based query resolution system, and the implementation of clear KRAs and appraisal frameworks across departments.
The Company also introduced unique employee engagement initiatives during FY 2025-26, including the celebration of employees childrens academic achievements (trophies and cheques for Board exam toppers), birthday celebrations with the CEO, and a 15-idea new joinee experience programme covering the entire journey from pre-joining to 90 days.
Industrial relations remained cordial throughout the year, with no instances of work stoppages or labour disputes.
The Company, through its CEO Mr. Gaurav Bhandari, has been deeply committed to social impact initiatives that go beyond traditional CSR. The most significant initiative during FY 2025-26 was the Empowering Her Future programme - under which Mr. Bhandari personally opened 1,000 Sukanya Samriddhi Yojana and NPS Vatsalya accounts for underprivileged girl students of SPRJ Kanyakhala, Ghatkopar, Mumbai - a school that has been providing completely free education to girls from economically weaker sections for nearly 100 years.
The initiative was formally launched on July 31, 2026 in the presence of the Honble Chief Minister of Maharashtra, Shri Devendra Fadnavis, as the Chief Guest. Mr. Bhandari deposited ? 20,000 in each of the 1,000 accounts and has committed to continuing this annually for the next 10 years - a total commitment of ? 20 Crore. The money can only be withdrawn by the girl herself after she turns 18, ensuring that the financial security reaches the intended beneficiary directly.
Additionally, Mr. Bhandari supports the Society for Welfare of Mentally Handicapped (SWMH), Jaipur - a pioneering institution serving over 100 children with intellectual and developmental disabilities - and is personally constructing 75-80 residential apartments in Indore for underprivileged families at a nominal cost of ? 5 Lakh against a market value of ? 35-40 Lakh.
The Company enters FY 2026-27 with strong momentum, a diversified business model, a robust balance sheet with over ? 971 Crore net worth, net debt free balance sheet, and a clear strategic roadmap for the next phase of growth.
The key strategic priorities for FY 2026-27 and beyond include the launch of the AMC (Mutual Fund) business, scaling AIF AUM beyond ? 2,000 Crore, growing PMS AUM to ? 500+ Crore, converting the active Investment Banking pipeline of ? 2,625+ Crore, continuing the expansion of the retail broking network and client base, completing the IT transformation programme, and strengthening the institutional equities franchise.
Indias macroeconomic fundamentals remain strong, with GDP growth projected at 6.7% by RBI for FY 2026-27, inflation expected to remain within the RBIs target range, and domestic institutional flows providing structural support to capital markets. While near-term risks from geopolitical uncertainty and crude oil volatility remain, the Companys diversified revenue model, strong capital position, and multi-engine growth platform position it well to navigate these challenges and deliver sustainable, profitable growth.
The Company remains committed to its vision of building one of Indias most respected financial services institutions - combining professional excellence with social responsibility, and measuring success not just in financial metrics but in the positive impact created for clients, employees, shareholders, and the communities it serves.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the Companys objectives,
projections, estimates, expectations, or predictions may be forward-looking statements
within the meaning of applicable securities laws and regulations. Actual results could
differ materially from those expressed or implied. Important factors that could make a
difference to the Companys operations include economic conditions affecting
demand/supply, price conditions in domestic and international markets, changes in
government regulations, tax laws, other statutes and other incidental factors. The Company
assumes no responsibility in respect of forward-looking statements, which may be amended
or modified in the future on the basis of subsequent developments, information, or events.
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